Jack in the Box to redeem 8 3/8% notes with refinance proceeds

New York, Dec. 12 - Jack in the Box Inc. (Ba2/BB) said it will redeem its redeem $125 million of 8 3/8% senior subordinated notes due 2008 with proceeds from a refinancing that includes a new $275 million senior secured term credit facility and an amendment to its existing $200 million revolving credit facility.

Jack in the Box, a San Diego-based restaurant chain operator, said it also intends to use the proceeds from the new facility to refinance its existing $150 million term credit facility. Its revolving credit facility will continue to be used for general corporate purposes.

While the redemption of the 8 3/8% notes and write-off of deferred financing fees will result in a pre-tax charge to earnings in the first fiscal quarter of approximately $9 million to $10 million, it is anticipated that the company's borrowing costs, as compared with the existing credit facility, will be reduced by some $3 million per year over the term of the new facility.

The company did not give any indication of the timing of any possible repurchase or redemption of the 8 3/8% notes. It said terms and timing of the new credit facility are subject to various market factors, as well as the completion of definitive documentation.

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